Currently, the extensive and unprotected use of one's identity information makes it very hard to prevent such identity information from being collected, misused or mismanaged. For example, people are required to disclose their social security numbers and dates of birth to landlords when applying for renting a property, to disclose the same information to loan officers when applying for loans, to disclose the information to service representatives when applying for cellular phone services, etc. One needs to disclose his/her credit card information to the person on the other end of the telephone line when making a hotel reservation or when reserving a rental boat. When shopping on-line or off-line with credit cards, credit card numbers along with other personal information need to be disclosed. People have no control over how the disclosed information will be managed and used. Even worse, people are vulnerable to information collection attacks. People are sent credit card application invitations with good offers. All they need to do to apply for a credit card is to fill in their social security numbers, dates of birth and other personal information. Yet, these invitations may come from an entity that is trying to collect personal information. Because of the unprotected and extensive use of identity information, identity theft has become a serious problem that can affect anyone. Another problem with the extensive use of sensitive information is that people can lose privacy without even knowing it. Vendors can collect an individual's shopping lists and use them to get other information about the individual. Also, the more one uses his/her sensitive information over the transmission media, the more susceptible the information is to being intercepted and collected.
In U.S. Pat. No. 5,884,272, a method and system for establishing anonymous communications between two parties are described. In this prior art, a central database is used to store the two parties' identities and data, as well as the rules for releasing the data. The two parties could get each other's information without having to disclose its own identity. This prior art is for establishing anonymous communications between only two parties and requires that the data and/or information sources related to both parties be centralized.
In U.S. Pat. No. 6,029,890, a user-specified credit card system is described. In this prior art, a central bank control system is used to transmit a user's request for a one-time credit card number to a credit provider and transmit back a one-time credit card number from the credit provider after the request is validated by the credit provider. This prior art would achieve the object of not giving out a static credit card number to the vendors. However, it requires a fairly large amount of changes to the current financial networks, including credit card approval and ATM networks to implement the central bank control system in this prior art. It also requires changes to each credit provider's business processes at a low level which is more difficult than making changes at a higher level. Therefore, it is costly and not easy to implement this prior art. In another prior art, U.S. Pat. No. 5,890,137, a method of credit card payment settlement in an on-line shopping system is described. In this method, a service center sends order data including the credit card information via a settlement network. The approval center pays the price to the service center. Then, service center sends the order information to the shopping system. This way the credit card information is not transmitted in public networks, such as the Internet. This prior art too, requires a large amount of changes to the existing business processes. In another prior art, U.S. Publication No. 2001/0044787, an electronic secure private agent is used to help conducting anonymous secure electronic transactions. In this prior art, the secure private agent mediates communication between the consumer and electronic commerce sites and monitors Internet browsing activities of the consumer, which is not desirable as the consumer and the commerce site may not want the transactions being monitored by a third party. Also this prior art cannot be used for offline transactions.